A Niger Delta based company, Macobarb International Ltd is set to drag the Nigeria Liquefied Natural Gas Ltd.(NLNG) to Court for one billion naira damages due a gross violation of Nigerian Local Content policy, malicious contract termination and fraud
Addressing a press conference, Mr. Ogboru Shedrack, the company’s Managing Director accused NLNG of maliciously strangulating Macobarb Int’l Ltd on a security related project it awarded in appreciation of Contractor’s competence, but disobeyed the contractual agreement by persistent payments failures and avoiding dispute resolution mechanism of the contract.
He said NLNG insistence on the court option as he has been told was only a time- buying gimmick of the few elements behind the contract violations aimed to annihilate Macobarb Int’l Ltd, as a typical example of privileged individuals in NLNG, actively aided by a few persons in NLNG legal/litigation departments to destroy Nigerian contractors.
Mr. Ogboru further said these actions were not known to the majority of NLNG staff, especially very many decent men and women of the highly esteemed company. “It’s a disservice to the Federal Government efforts at fighting corruption when these elements portray Nigerian Court as dumping ground to buy time by offending parties or a place where justice is for sale to highest bidder, as NLNG who violate contract they crafted, boastfully ask abused contractor to go to court. This indeed, is a disservice to Nigeria.”
Mr. Ogboru Shedrack, said however that he had decided to go to court and prayed that justice would be done. He added that Macobarb International Ltd would be demanding for:
(a) An Order of Court directing Nigeria LNG Ltd to pay to Macobarb Int’l LTD the sum of NGN957,676,562.50 being the standing-by costs incurred by the Claimants during downtime/standing-by counting from 1st August, 2014 to 10th February, 2016 when Nigeria LNG Ltd belatedly fixed a date and time for the contract close-out after which the demobilization of all management, administration, personnel, equipment, plant, transportation, tools, machinery, materials, services, utilities, attendances, et cetera on downtime was performed by the Claimants.
(b) A Declaration that the letter of termination of contract dated 27th November, 2015 with which Nigeria LNG Ltd terminated the contract of Macobarb Int’l LTD relying on the notice of default and termination dated 20th November, 2015, is ineffectual and otiose.
(c) An Order of Court setting aside the said letter of termination of contract dated 27th November, 2015 and directing that Nigeria LNG Ltd pays the Claimants the sum of N200,000,000 as damages for breach of contract and unlawful termination of contract.
(d) An Order of Court pursuant to Order 35 Rule 4 of the Rivers State High Court (Civil Procedure) Rules, 2010 that Nigeria LNG Ltd pays the Claimant 20% interest rate per annum on the judgment sum counting from the date of the judgment.
STATEMENT OF CLAIM
1. Macobarb Int’l LTD is a Private Limited liability Company registered under the Laws of the Federal Republic of Nigeria. Macobarb Int’l LTD is competently engaged in the variety of objects as a private limited liability company inclusive in the area of civil engineering and construction.
2. The 2nd Claimant, Mr. Shedrack Ogboru, is the Managing Director and Chief Executive Officer of Macobarb Int’l LTD as well as the alter ego of Macobarb Int’l LTD.
3. The defendant, Nigeria LNG Ltd, is also a Limited Liability Company incorporated in Nigeria sometimes in May, 1989 to harness and explore Nigeria’s vast natural gas resources and produce Liquefied Natural Gas (LNG) and Natural Gas Liquids (NGLs) with an office at Bonny Island, Rivers State.
4. The subject matter of this action is founded on breach of contract orchestrated by the unconscionable and deliberate flagrant breaches by Nigeria LNG Ltd of the terms of contract entered into between Macobarb Int’l LTD and Nigeria LNG Ltd.
5. Sometimes in January, 2014, Nigeria LNG Ltd in consideration of over 62 contractual projects in the area of civil construction successfully and creditably executed by Macobarb Int’l LTD for Nigeria LNG Ltd in addition to Macobarb Int’l LTD’s tender and presentation, awarded Macobarb Int’l LTD contract No. B130142PPI, ACCESS CONTROL TO CCR, LABORATORY, SHUTDOWN VILLAGE AND GAS PLANT AREA PROJECT. A copy of the letter of award of contract by Nigeria LNG Ltd to Macobarb Int’l LTD and duly endorsed by the 2nd Claimant on behalf of Macobarb Int’l LTD dated 9th January, 2014 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial.
6. The said contract No. B130142PPI, ACCESS CONTROL TO CCR, LABORATORY, SHUTDOWN VILLAGE AND GAS PLANT AREA PROJECT is otherwise known as “Engineer, Procure and Construct” (EPC) and which is one of the highest categories of projects in civil construction in Nigeria LNG Ltd’s Company can only be awarded to a proven experienced civil construction company that has achieved untainted and unbroken chains of record of previous credible performances and it was on the strength of this qualification that the said contract was awarded by Nigeria LNG Ltd to Macobarb Int’l LTD considering Macobarb Int’l LTD’s attested unbroken chains of previous performances.
7. Because of the sensitive nature of this contract, the parties to the contract deemed it most expedient to have a binding documentary agreement that would regulate the performance of the contract to avoid unwarranted strangulation or stifling by the default or negligence of either party and consequently the said contract was regulated by 3 principal contractual documents, namely: MEMORANDUM OF AGREEMENT, PARTICULAR CONDITIONS OF CONTRACT, GENERAL CONDITIONS OF CONTRACT, amongst others as contained in a BOOKLET FORM which is hereby pleaded and Nigeria LNG Ltd is given notice to produce its own copy of the BOOKLET FORM Contract Agreement during trial.
8. Section 1 sub-section 2.0 of the said Memorandum of Agreement in Pages 3 and 4 of the BOOKLET Agreement provides the duration for the performance of the contract wherein it was stated in these words: “The Contract Period shall include for Time for Completion of the works, Maintenance Period (12 months), time for rectification of works thereafter and contract close-out. This period is not expected to exceed three years from a commencement date of 10th January, 2014.”
9. The said contract is stated in Section 2 Sub-section 2.1 of the PARTICULAR CONDITIONS OF CONTRACT in Page 6 of the BOOKLET Agreement to be for a lump-sum and the contract price stated in Section 7, page 9 thereof to be N95,479,057.86. However, by the tenor of the provisions of the said contract agreement under reference, the guide on the mode of payment of the said lump-sum contract price is clearly stated in Section 1 sub-section 3.0 of the Memorandum of Agreement in pages 3 -4 of the Booklet Agreement in these words: “In consideration of the due performance of the Works by the Contractor and the performance of its other obligations under the contract, the Company shall pay to the Contractor all sums in accordance with section 8 (Schedule of Rates and Prices), as well as other sums or amounts as may become payable to the Contractor pursuant to the provisions of the contract, (herein called the Contract Sum).”
10. It is pertinent to state that the Memorandum of Agreement is the highest binding document of agreement, apart from Statutory Regulations, in the order of precedence of other contract agreements in respect of this matter by virtue of Section 2 Sub-section 3.1 of the PARTICULAR CONDITIONS OF CONTRACT in pages 6 and 7 of the BOOKLET Contract Agreement.
11. It is on the strength of the provisions of Section 1 sub-section 3.0 of the said Memorandum of Agreement that the lump-sum contract sum of N95,479,057.86 is broken down in Section 8 of (Schedule of Rates and Prices) into distinct bit payments based upon the value of work done as set out in Section 8 Sub-section 3.0 in page 38 of the Booklet Agreement and which said distinct bit payments based on the value of work done shall be payable on submission of invoices verified and signed by the Company’s Contract Holder by virtue of Section 8 Sub-Section 5.1.3. in page 39 of the BOOKLET Agreement.
12. Section 2 sub-section 1.23 of the PARTICULAR CONDITIONS OF CONTRACT in page 6 of the Booklet Agreement contains the Interpretation Section of the contract agreement and same defines “Work” as in “work done” to mean “all activities pertaining to … management, administration, supervision, provision of personnel and/or equipment, plant, transportation, tools, machinery, materials, services, utilities, protections, attendances, and any other resources, requirements or activities necessary for satisfactory performance of the contract or any part thereof.”
13. Having regard to the fact that the lump-sum contract price shall be paid distinctly based on “work done” as defined in Section 2 sub-section 1.23 of the PARTICULAR CONDITIONS OF CONTRACT in page 6 of the Booklet Agreement to include materials, personnel and/or equipment etcetera procured by the Claimants, the Claimants deemed it expedient to source for credit facility from Diamond Bank Plc to finance the project such that all distinct payments to be made by Nigeria LNG Ltd on “work done” in the area of procurement of materials, amongst others, shall be paid into the Claimants’ loan account with Diamond Bank in liquidation of the said facility.
14. Upon the Claimants’ application for credit facility, Diamond Bank Plc demanded from the Claimants the contract documents in order to ascertain the mode of payment of the lump-sum contract price and upon going through the contract documents and realizing that there is a provision for distinct bit payments based on the value of work done by the Claimants as defined, the Bank therefore issued the Claimants with an offer of credit facility of 50 million naira (though later upgraded to 68,800,000.00) on condition that the said distinct bit payments based on value of work done should be remitted into the loan account in liquidation of the said facility.
15. The Bank therefore by the condition of the grant of the said facility, expressly stated in the Bank’s offer letter the following words in the column written “SECURITY”: thus: “Domiciliation of contract payments: The word payments therein written in plural form corroborates the fact that there is a provision for distinct bit payments based on the value of work done out of the lump sum. A copy of the Diamond Bank Plc offer of credit facility dated 04 February, 2014 to the Claimants is pleaded.
16. This provision on distinct bit payments based on value of work done payable by Nigeria LNG Ltd to the Claimants’ bank is made clearer in Section 8 Sub-section 6.4 in page 42 of BOOKLET Agreement which states thus: “Payments will be made by direct bank transfer. The Contractor is to advise the company of its banker’s details and nominated account no. to receive remittances for services related to this contract”
17. Nigeria LNG Ltd was aware of this development as the Claimants promptly wrote to Nigeria LNG Ltd directing that all contract payments be made into the said loan account domiciled in Diamond Bank Plc. A copy of the said Letter of Mandate by the Claimants to Nigeria LNG Ltd to direct all contract payments into the said Claimants’ said account domiciled with Diamond Bank is pleaded and Nigeria LNG Ltd is given notice to produce her own copy during trial.
18. The Claimants indeed procured the said credit facility from Diamond Bank Plc to finance the said project at a very high interest rate.
19. As a matter of equity and fair play between the parties to the contract and to avoid strangulation or stifling of due performance of the contract by either party, the contract agreement made provision for circumstances under which the Claimants will bear the delay and costs incurred as a result of default occasioned by the Claimants’ own default and also the circumstance under which Nigeria LNG Ltd will bear the costs incurred by the Claimants occasioned by the default of Nigeria LNG Ltd otherwise known as standing time costs.
20. Consequently, by Section 7 sub-section 12.4 in page 30 of the BOOKLET Agreement, the Claimants are to bear the costs otherwise called standing time costs where the Claimants deliver any items of materials, plants or equipment which do not meet the design requirement or specifications of the project and which resulted to costs and delay in the timeous completion of the project.
21. In the same vein, Nigeria LNG Ltd shall by Section 7 sub-section 5.11 of page 28 of the BOOKLET Agreement bear the costs incurred by the Claimants if by reason of any failure or inability of Nigeria LNG Ltd to give approval or perform its own part of the contract after a notice in that regard has been given by the Claimants and the Claimants in the circumstance suffer delay and/or incurred costs, then the time for the completion of the contract shall be extended and amount of such costs incurred by the Claimants shall be added to the contract sum and be paid by Nigeria LNG Ltd to the Claimants.
22. With this equitable working arrangement as borne out in the contract agreement under reference in paragraphs 20 and 21 of this Statement of Claim, the Claimants therefore proceeded to utilize the said bank facility procured from Diamond Bank Plc to mobilize both equipment and personnel to the contract site in performance of the contract under very high costs in addition to procurement of vital materials overseas according to Nigeria LNG Ltd’s specifications and thereby accomplished the most difficult aspect of the contract as “work done” as at 20/06/2014.
23. Due inspection of the materials was subsequently conducted by Nigeria LNG Ltd and inspection was confirmed successful by the Contract Holder, Dweller Francis, via a mail dated Friday, October 17th, 2014. The Inspection document and the confirmatory note of successful inspection by the Contract Holder, Dweller Francis, are pleaded and Defendant is given notice to produce the said documents during trial. These documents were produced by the computer during which period the computer was used regularly to store or process information with accurate operation.
24. The Claimants had duly delivered to Nigeria LNG Ltd the invoice of the work done through the Contract Holder, Dweller Francis, on the same 20/06/2014 with a valued 1st milestone or work done to be at N32,079,723.10 as at 20/06/2014 and therefore requested for payments of the said work done pursuant to the terms of the contract. A copy of the said invoice with a monetary value of N32,079,723.10 for the work done as at 20/6/2014 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial.
25. By Section 8 sub-section 6.3 in page 41 of the BOOKLET Agreement, where Nigeria LNG Ltd’s Company intends to contest any invoice delivered to it by the Claimants, Nigeria LNG Ltd shall notify the Claimants in writing within 7 days of receipt of any contested invoice without which the said invoice and its value shall be deemed to have been accepted by Nigeria LNG Ltd and payment be made to the Claimants accordingly.
26. There was no notice in writing delivered to the Claimants by Nigeria LNG Ltd contesting the value of work done as contained in the said invoice within 7 days after the delivery of the Invoice to Nigeria LNG Ltd on 20/6/014 through the Contract Holder, Dweller Francis, yet Nigeria LNG Ltd without complying with the provisions of Section 8 sub-section 6.3 in page 41 of the BOOKLET Agreement underpaid the Claimants by paying the sum of N8,072,754.15 on the 15/7/2014 to the Claimants instead of the sum of N32,079,723.10.
27. The Claimants promptly notified Nigeria LNG Ltd on the adverse consequences of this breach with regard to the said underpayment for the work done, the Claimants having virtually exhausted the full value of the facility procured from Diamond Bank in addition to their personal funds which have been invested in personnel, materials, especially in turnstile and vehicle barriers manufacture and that the said sum of N8 million paid into the Claimants’ loan account could only settle to some extent, the accrued interest and that with this development, Diamond Bank would never advance further funds to the Claimants and which shall have the consequential effect of stifling the project.
28. Nigeria LNG Ltd indeed realized the consequences of her action in denying the Claimants payment of the value of work done when the staff of Nigeria LNG Ltd engaged themselves in e-mail correspondences especially that between Anene Promo of Contract dept (CPM) and Murtala of finance department during which time Nigeria LNG Ltd’s representatives admitted that the Claimants were really struggling with cashflow. Nigeria LNG Ltd however pretentiously resolved to arrange an imaginary alternative source of funding for the Claimants which turned out to be fruitless. Copies of the e-mail correspondences between Anene Promo of Contract dept (CPM) and Murtala of finance department dated July 8, 2014 are pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial. These documents were produced by the computer during which period the computer was used regularly to store or process information with accurate operation.
29. The Claimants were therefore placed in a hopeless situation of which they were not able to pay salaries of personnel or further procure any construction material consequent upon which the workers and the equipment became idle and on downtime with the bank interest loan going higher and being compounded.
30. The worst of this situation was that the 2nd Claimant had no further resources to travel to the United kingdom for Factory Acceptance Test (FAT) as the Turnstile and Vehicle barriers manufacture was about to be completed and the most agonizing part of it was that the Civil, Electrical and IT works awaiting the Turnstile and Vehicle barriers arrival for installation were all on hold, as a result of lack of fund. The downtime or Standby costs being incurred by the Claimants kept on rising.
31. On the strength of this hopeless and regrettably situation of being continuously placed on Standing-by status as a result of the default or neglect by Nigeria LNG Ltd in paying the Claimants the value of the work done as at 20/06/2014, the Claimants were therefore constrained to invoke the provisions of Section 7 sub-section 5.11 in page 28 of the BOOKLET Agreement by giving Nigeria LNG Ltd notice of being placed on downtime or standing-by as a result of fund denial via a letter dated 30th July, 2014 which was duly delivered to Nigeria LNG Ltd through the Contract Holder, Dweller Francis. A copy of the Claimants’ letter dated 30th July, 2014 notifying Nigeria LNG Ltd on being placed on downtime or standing-by is pleaded and Nigeria LNG Ltd is given notice to produce same during trial.
32. Nigeria LNG Ltd did not respond to the Claimants’ letter of 30th July, 2014. Meanwhile the Claimants had made a demand to Nigeria LNG Ltd for the payment of STANDBY COSTS incurred by the Claimants as a result of the default of Nigeria LNG Ltd in paying the Claimants the value of the work done via a letter dated the 13th day of July, 2015 addressed to the GRC Manager wherein the Claimants gave particulars of the standing-by costs incurred and which at that material time ran for a period of 396 days from July 1st 2014 to July 31st 2015 and to the tune of N646,101, 360.00. A copy of the Claimants’ letter dated 13th day of July, 2015 addressed to the GRC Manager stating the particulars of Standing by costs is pleaded and Nigeria LNG Ltd is given notice to produce same during trial.
33. Nigeria LNG Ltd never contested the particulars of equipment and labour set out by the Claimants in the letter of 13/7/2015 as well as the corresponding cost of the Standby costs set out therein and delivered to her by the Claimants via the said letter of 13/7/2015 but rather Nigeria LNG Ltd erroneously insisted that there is no provision in the Contract Agreement for Standby cost.
34. At any rate, having regard to the said formal Notice of downtime/Standing-by dated 30th July, 2014 which was subsequently made in full compliance with the provisions of Section 7 sub-section 5.11 in page 28 of the BOOKLET Agreement already pleaded in paragraph 31 of this Statement of Claim, the Downtime/Standing-by costs ought to start running from the 1st day of August, 2014, the said formal notice having superseded particulars of standing-by cost as contained in the Claimants’ letter dated 13th day of July, 2015 addressed to the GRC Manager already pleaded in paragraph 32 of this Statement of Claim wherein downtime costs were meant to count from July 1st 2014.
35. While the Claimants were still battling with the rising Standby costs being incurred as the days went by as a result of the default of Nigeria LNG Ltd in underpaying the Claimants as well as the outright denial of payments to the Claimants by Nigeria LNG Ltd, the Claimants were notified by the manufacturers of Turnstiles and Vehicle barriers through Richard Lace via a mail dated and sent on August 22, 2014 that the manufacture and factory inspection of the Turnstiles and Vehicle barriers had been completed successfully and with excellence. A copy of the said mail by Richard Lace dated and sent on August 22, 2014 and of which the 2nd Claimant sent a copy thereof to the Contract Holder is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial. This document was produced by the computer during which period the computer was used regularly to store or process information with accurate operation.
36. The said materials as pleaded in paragraph 35 of this Statement of Claim were shipped and delivered to Nigeria LNG Ltd on two phases, the 1st phase was delivered to Nigeria LNG Ltd and the delivery document endorsed by Nigeria LNG Ltd’s representative on 27/2/2015 while the 2nd phase was delivered to Nigeria LNG Ltd on 7/5/2015 and the delivery document endorsed by Nigeria LNG Ltd’s representative. The document of delivery of the materials endorsed by Nigeria LNG Ltd’s designated officer on 27/2/2015 and that endorsed on 7/5/2015 are pleaded and Nigeria LNG Ltd is given to produce same during trial.
37. Again, Nigeria LNG Ltd through the Contract Holder, Dweller Francis, amongst other staff of Nigeria LNG Ltd raised an interim payment certificate dated 15th May, 2015 for the 2nd valuation of the work done by the Claimants which is assessed at N33,588,401.76. This monetary value of the work done raised by Nigeria LNG Ltd through the Contract Holder is in keeping with the Invoice of the work done delivered by the Claimants to the Contract Holder also dated 15th May, 2015 of which the Claimants have lost their copy. A copy of the interim payment certificate dated 15th May, 2015 raised by Nigeria LNG Ltd and that of the corresponding Claimants’ invoice for the work done are pleaded and notice is hereby given to Nigeria LNG Ltd to produce its own copy during trial.
38. Nigeria LNG Ltd did not challenge the interim payment certificate or the corresponding invoice by the Claimants on the 2nd valuation of the work done by any notice in writing within 7 days from the said date of 15th May, 2015 but regrettably Nigeria LNG Ltd never made any payment in respect of the said invoice.
39. It is interesting to note that Nigeria LNG Ltd fully understood the hopeless situation she has placed the Claimants into by recurrent payment denials for the work done by the Claimants and this is borne out in the minute of meeting No. 17 of 09/07/2015 wherein pertinent issues where raised as follows:
a. In paragraph 1.2 of the said minute of meeting shown below HSE Statistics table, Nigeria LNG Ltd admitted that Work has been on HOLD because of Macobarb Int’l LTD’s financial constraint.
b. In paragraph 5.4.1 of the minute of meeting, it was understood that the project had not been in progress because of payment denials and that Diamond Bank interest on loan procured by the Claimants was on the increase.
c. In paragraph 5.5.3. of the minute of meeting, the Claimants drew the attention of Nigeria LNG Ltd to the loses and costs being incurred, the idle time for plant and personnel on Site and reiterated the Claimants’ right to a claim against Nigeria LNG Ltd for costs incurred for being on standby status having been denied payment since June 2014.
d. In paragraph 5.4.3. of the minute of meeting, it was clearly stated that cancellation of Nigeria LNG Ltd’s contract is not an option.
e. Consequent upon these vital issues raised in the meeting No. 17 of 09/07/2015, the Claimants in paragraph 5.5.4 of the minute of meeting requested for a 12 months extension of the contract schedule and requested for a provision of Advance Payment from Nigeria LNG Ltd to enable the Claimants deliver the project. A copy of the minute of meeting No. 17 dated 09/07/2015 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial.
40. Instead of Nigeria LNG Ltd vigorously addressing these cardinal issues raised in the meeting No. 17 of 09/07/2015 as pleaded, Nigeria LNG Ltd as a show of predetermined strategy to frustrate the Claimants in performing the contract because of selfish interest of some officers of Nigeria LNG Ltd, Nigeria LNG Ltd gave the Claimants NOTICE OF DEFAULT AND TERMINATION asserting that unless the alleged default by the Claimants were remedied within 3 days from the date of the letter/notice, the contract shall stand terminated forthwith. A copy of the said notice of default and termination dated 20th November, 2015 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial.
41. The said notice of default and termination dated 20th November, 2015 is tainted with malice and fraud:
PARTICULARS OF FRAUD/MALICE
a. The 3 days notice to remedy imaginary default not occasioned by the Claimants is stated to start counting from the date of the letter of which there is no proof of when it was sent to Warri office of the Claimants. The three days given to remedy default contained in the said letter was not to count from date of delivery to the Claimants but rather to count from the date the said letter was written while in custody of Nigeria LNG Ltd.
b. Nigeria LNG Ltd knows very well the branch office of the Claimants which is in the same Bonny Island, Rivers State within jurisdiction of which both the Claimants and Defendant have offices and had the said letter delivered to the Bonny Island of the Claimants’ office, same would have reached the Claimants timeously if the said letter was actually posted.
c. The said notice of default and termination even at the point of writing it contains a farewell message to the Claimants wishing them well in their future endeavours implying that the contract was deemed terminated at the point of writing the notice of default.
d. The said notice of default and termination further directed the Claimants that immediately after 3 days of writing the said notice even without delivery; the Claimants should contact the Contract Holder for a contract closeout.
e. The ultimate intention of Nigeria LNG Ltd was to circumvent the payment of huge costs and losses incurred by the Claimants for being placed on downtime and for Nigeria LNG Ltd to re-award the contract to another firm with a view to making selfish profit.
42. The Claimants shall contend during hearing that having regard to the fact that the stagnation of the project was by reason of Nigeria LNG Ltd’s own default and breach in not paying the Claimants for the work done, Nigeria LNG Ltd is estopped from giving the Claimants notice of default and termination of contract.
43. At any rate, when a copy of the said notice of default and termination was eventually forwarded to the 2nd Claimant’s phone belatedly, the 2nd Claimant replied to the said notice of default via a reply letter dated 23rd November, 2015 which was received by Nigeria LNG Ltd on the 26th day of November, 2015 and wherein the Claimants put the record very clear to the effect that they have never defaulted on the contract but were rather placed on downtime by the default of Nigeria LNG Ltd. A copy of the Claimants’ said reply letter dated 23rd November, 2015 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial.
44. Nigeria LNG Ltd got the Claimants’ said reply letter and knowing that she has no answer to the issues and downtime claim raised in the said reply letter, Nigeria LNG Ltd proceeded to purportedly terminate the Claimants’ contract via a letter dated 27th November, 2015 in order to circumvent paying huge costs incurred by the Claimants occasioned by being placed on Standing-by. A copy of the said letter of termination of contract dated 27th November, 2015 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during trial.
45. The Claimants shall contend during hearing that Nigeria LNG Ltd’s letter of termination of contract dated 27th November, 2015 is otiose, void and ineffectual for reasons which include non-compliance with the mandatory 14 days notice which ought to be given to Macobarb Int’l LTD prior to any termination by virtue of Section 36(ii) of the GENERAL CONDITIONS OF CONTRACT amongst others.
46. The Claimants shall further contend on the strength of section 37 of the GENERAL CONDITIONS OF CONTRACT that the said unlawful termination of the Claimants’ contract by Nigeria LNG Ltd in order to circumvent the payment of the full costs incurred by the Claimants at the material time of downtime or standing-by does not in any manner prejudice the right or remedies that accrue to the Claimants to have full claim of the costs incurred during the downtime or Standing by.
47. Notwithstanding the purported, malicious and unlawful termination of the Claimants’ contract via Nigeria LNG Ltd’s letter of termination of contract dated 27th November, 2015, the downtime costs continued to increase as Nigeria LNG Ltd refused to fix a date for the contract close-out which would have made the incurred costs for “all activities pertaining to management, administration, supervision, personnel, equipment, plant, transportation, tools, machinery, materials, services, utilities, attendances, et cetera to stop running, but these inevitable costs continued to accumulate as orchestrated by Nigeria LNG Ltd simply to aggravate the Claimants’ deteriorated financial crises.
48. Nigeria LNG Ltd never fixed a date and time for contract close-out and never submitted or yielded to the settlement bid being explored by the Claimants. In fact, Nigeria LNG Ltd in her reply letter of 6th January, 2016 addressed to the Claimants’ Solicitors, KIERAN ENECHI & CO., avoided fixing a date for contract close-out but surreptitiously stated in the said reply letter thus: “… we are expecting your client on site to undertake the contract close-out activity, in line with applicable procedure.”
49. Nigeria LNG Ltd’s letter of 6th January, 2016 was pretentious. None of Nigeria LNG Ltd’s staff or representatives was permanently stationed at the Claimant’s site for the contract close-out and why Nigeria LNG Ltd chose not to fix a date and time for the said contract close-out remained an enigma except to say that same was deliberate for the ultimate intention of annihilating the Claimants by continuing to incur unwarranted costs on all management, administration, personnel, equipment, plant, transportation, tools, machinery, materials, services, utilities, attendances, et cetera on downtime. A copy of Nigeria LNG Ltd’s reply letter of 6th January, 2016 addressed to Claimants’ Solicitors, KIERAN ENECHI & CO. is pleaded and Nigeria LNG Ltd is given notice to produce her own copy during trial.
50. Had Nigeria LNG Ltd timeously submitted to the performance of contract close-out by the Claimants by honestly fixing a date and time for the contract close-out, the Claimants would have demobilized all management, administration, personnel, equipment, plant, transportation, tools, machinery, materials, services, utilities, attendances, et cetera on downtime and thereby stopped further accumulation of costs and then concentrate on challenging the unlawful notice of termination of the contract and the previously incurred downtime costs.
51. It was rather after many entreaties and persuasions that Nigeria LNG Ltd finally fixed date and time for the contract close-out which was eventually performed on 10th February, 2016 as reflected in the minutes of meeting on contract close-out of 10th February, 2016. A copy of the minutes of meeting on contract close-out of 10th February, 2016 is pleaded and Nigeria LNG Ltd is given notice to produce her copy during trial.
52. A calm perusal of the minutes of meeting on contract close-out of 10th February, 2016, shows that it was after Nigeria LNG Ltd had succeeded in frustrating the Claimants’ performance of the contract by refusing to pay the Claimants for the ´work done” especially in the area of all equipment, plant, transportation, tools, machinery, materials, services, utilities, attendances, et cetera that Nigeria LNG Ltd now impliedly admitted that materials delivered by the Claimants constitute “work done” that is payable by Nigeria LNG Ltd.
53. A further calm perusal of the minutes of meeting on contract close-out of 10th February, 2016 especially item No. 3 thereof equally shows that Nigeria LNG Ltd unequivocally admitted to pay for all cost incurred by the Claimants, which include downtime costs, except the cost for demobilization after the contract close-out.
54. The Claimants were therefore constrained to retain the services of financial experts and chartered accountants to calculate the costs incurred by the Claimants during downtime as a result of the deliberate failure of Nigeria LNG Ltd to pay the Claimants for the work done in performance of the contract in keeping with Nigeria LNG Ltd’s assurance in item No. 3 of the minutes of meeting on contract close-out of 10th February, 2016 and the downtime/Standing costs from 1st August, 2014 stood at the tune of NGN957,676,562.50 as at the 10th February, 2016 when Nigeria LNG Ltd belatedly fixed a date and time for the contract close-out of the said contract purportedly and unlawfully terminated by Nigeria LNG Ltd on the 27th November, 2015. The said report of the Financial Expert is pleaded and its contents are incorporated by reference in this pleading.
55. It was later revealed that the Claimants’ ordeal was instigated by one Mr. Bayo Adenrele, the Head Project Services of Nigeria LNG Ltd who had vowed to frustrate the Claimants simply because of an event in 2010 when the Claimants’ design `ROOF OVER RA FOOTBALL PITCH STANDS` was accepted by Nigeria LNG Ltd’s Management against the suggested design by the said Bayo Adenrele which is in the nature of cantilever model.
56. The said Bayo Adenrele started having malicious disposition against the Claimants and when he incidentally became the Head of Project Services in respect of the instant contract awarded to the Claimants, he vowed to run Macobarb Int’l Ltd out of business in all Nigeria LNG Ltd’s projects starting first with stifling of the ongoing contract by denial of payments for the work done by the Claimants.
57. The Claimants adopted all possible remedial measures to settle this matter amicably with Nigeria LNG Ltd inclusive giving NOTICE OF DISPUTE dated the 31st day of March, 2016 to Nigeria LNG Ltd pursuant to Section 41(ii) of the GENERAL CONDITIONS OF CONTRACT via a NOTICE OF DISPUTE which was duly delivered to Nigeria LNG Ltd but Nigeria LNG Ltd in its normal boastful disposition under the instigation of Bayo Adenrele bluffed the Claimants’ NOTICE OF DISPUTE because of his resolve to victimize the Claimants and frustrate the contract. A copy of the NOTICE OF DISPUTE given to Nigeria LNG Ltd by the Claimants dated 31st March, 2016 bluffed by Nigeria LNG Ltd is pleaded and Nigeria LNG Ltd is given notice to produce its own copy.
58. However, the then outgoing Managing Director of Nigeria LNG Ltd, Babs Omotowa, appeared to have understood the Claimants’ innocence and assertions on flagrant breach of the terms of the contract by Nigeria LNG Ltd and therefore made Nigeria LNG Ltd to reconsider its position and resolved to re-award the contract to the Claimants for completion but the said Managing Director incidentally did not include payment of huge incurred costs occasioned by Standing-by based on payments denials on the value of work done by the Claimants which ought to be most cardinal to enable the Claimants finance the conclusion of the said project after paying all incurred costs during downtime.
59. The Claimants again continued their search for amicable resolution of this matter by writing to the Chairman Senate Committee on Gas Resources for his intervention in this matter and consequent upon which notice of meeting was served on both parties via a letter dated October 20, 2016. A copy of the letter of invitation dated October 20, 2016 from the office of Chairman Senate Committee on Gas Resources is pleaded and Nigeria LNG Ltd is given notice to produce its own copy.
60. Nigeria LNG Ltd responded to the Claimants’ petition and concluded its response by appealing to the Chairman, Senate Committee on Gas Resources to direct the Claimants to go to Court for redress. This is not only discourteous but also shows the boastfulness, recalcitrance and belligerence of Nigeria LNG Ltd under the instigation of the man who has vowed to frustrate the Claimants just for mere selfish interest.
61. However, the Claimants in search of peaceful and amicable settlement of this matter were not deterred by the recalcitrant disposition of Nigeria LNG Ltd and therefore further petitioned to the Rivers State House of Assembly through the House Committee on Public Complaint and Petitions (HCPCP) for intervention
62. After hearing the parties and by the intervention of the Chairman of the said House Committee following the indication of Nigeria LNG Ltd to handle this matter within its management capacity, the Claimants withdrew the said petition at the instance of Nigeria LNG Ltd. This position is as stated in the letter by Committee Secretary to the parties dated 27th April, 2018 wherein the House Committee thanked the parties for their understanding to settle the matter amicably. A copy of the letter by the Rivers State House of Assembly Committee Secretary to the parties dated 27th April, 2018 is pleaded and Nigeria LNG Ltd is given notice to produce its own copy during hearing.
63. Nigeria LNG Ltd thereafter reneged on her promise to handle the matter within its management capacity as earlier assured but rather boasted of her earlier notice to the Rivers State House of Assembly to direct the Claimants to seek redress in Court as contained in her response to the petition.
64. The action of Nigeria LNG Ltd in unlawfully and abruptly terminating the Claimants’ contract has caused the Claimants untold hardship, psychological trauma and health challenges and Nigeria LNG Ltd is not prepared to reconsider the unlawfulness of its actions.
65. WHEREFORE THE CLAIMANTS have been damnified and claim against Nigeria LNG Ltd as follows:
(a) A declaration that by a holistic reading of the Contract Agreement between Macobarb Int’l LTD and Nigeria LNG Ltd in respect of Contract No. B130142PPI, ACCESS CONTROL TO CCR, LABORATORY, SHUTDOWN VILLAGE AND GAS PLANT AREA PROJECT as contained in the MEMORANDUM OF AGREEMENT, PARTICULAR CONDITIONS OF CONTRACT, GENERAL CONDITIONS OF CONTRACT, amongst others, as contained in the contract agreement BOOKLET, inclusive the sum of N8 Million paid at the material time by Nigeria LNG Ltd out of the lump sum of N95,479,057.86 for “work done” by the Claimants, the lump sum contract price of N95,479,057.86 founded on this contract is distinctively payable based on the monetary value of the “work done” by the Claimants out of the said lump sum contract price until the completion of the project.
(b) A Declaration that by a holistic reading of the Contract Agreement between Macobarb Int’l LTD and Nigeria LNG Ltd as contained in the MEMORANDUM OF AGREEMENT, PARTICULAR CONDITIONS OF CONTRACT, GENERAL CONDITIONS OF CONTRACT, amongst others, as contained in the contract agreement BOOKLET, inclusive the interpretation sections thereof and Nigeria LNG Ltd’s admissions in the minutes of meeting on contract close-out of 10th February, 2016, the “work done” includes the provision of personnel and/or equipment, plant, transportation, tools, machinery, materials etcetera and of which Macobarb Int’l LTD is entitled to be distinctively paid to the extent of the monetary value of the procurements made or “work done” in performance of the contract.
(c) A Declaration that by the combined effect of the provisions of Section 7 sub-section 12.4 in page 30 of the BOOKLET Agreement and Section 7 sub-section 5.11 of page 28 of the BOOKLET Agreement, in addition to other provisions of the Contract Agreement as well as the item No. 3 of the minutes of meeting on contract close-out of 10th February, 2016, downtime/Standing-by costs are subsumed in the contract and are payable by Nigeria LNG Ltd to Macobarb Int’l LTD if by reason of any failure by Nigeria LNG Ltd to perform its own part of the contract after a notice in that regard has been given by the Claimants and the Claimants in the circumstance suffer delay and/or incurred costs, in which case, the amount of such costs incurred by the Claimants shall be added to the contract sum and be paid by Nigeria LNG Ltd to the Claimants.
(d) A Declaration that by the combined effect of the provisions of Section 7 sub-section 12.4 in page 30 of the BOOKLET Agreement and Section 7 sub-section 5.11 of page 28 of the BOOKLET Agreement, in addition to other provisions of the Contract Agreement, such downtime/Standing-by costs payable by Nigeria LNG Ltd to Macobarb Int’l LTD include costs incurred by the Claimants occasioned by Nigeria LNG Ltd’s failure to pay Macobarb Int’l Ltd for the “work done”.
(e) A Declaration that having regard to the facts and circumstance of this case, the Claimants were placed on downtime/standing-by as a result of the default of Nigeria LNG Ltd in paying the Claimants the monetary value to the extent of “work done” upon the submission of the Invoice of the work done through the Contract Holder, Dweller Francis, on 20/06/2014 with a valued 1st milestone or work done at the tune of N32,079,723.10 as at 20/06/2014 and that of the interim payment certificate dated 15th May, 2015 for the 2nd valuation of the work done by the Claimants assessed at N33,588,401.76 and having regard to the acknowledgment by Nigeria LNG Ltd via the minute of meeting No. 17 of 09/07/2015 in paragraph 1.2 thereof that the project has been on HOLD because of Macobarb Int’l LTD’s financial constraint.
(f) An Order of Court directing Nigeria LNG Ltd to pay to Macobarb Int’l LTD the sum of NGN957,676,562.50 being the standing-by costs incurred by the Claimants during downtime/standing-by counting from 1st August, 2014 to 10th February, 2016 when Nigeria LNG Ltd belatedly fixed a date and time for the contract close-out after which the demobilization of all management, administration, personnel, equipment, plant, transportation, tools, machinery, materials, services, utilities, attendances, et cetera on downtime was performed by the Claimants.
(g) A Declaration that the letter of termination of contract dated 27th November, 2015 with which Nigeria LNG Ltd terminated the contract of Macobarb Int’l LTD relying on the notice of default and termination dated 20th November, 2015, is ineffectual and otiose.
(h) An Order of Court setting aside the said letter of termination of contract dated 27th November, 2015 and directing that Nigeria LNG Ltd pays the Claimants the sum of N200,000,000 as damages for breach of contract and unlawful termination of contract.
(i) An Order of Court pursuant to Order 35 Rule 4 of the Rivers State High Court (Civil Procedure) Rules, 2010 that Nigeria LNG Ltd pays the Claimant 20% interest rate per annum on the judgment sum counting from the date of the judgment.
